What To Watch For in the First Monopoly Trial of U.S. vs GoogleKarina Montoya / Sep 12, 2023
Karina Montoya is a journalist with a background in business, finance, and technology reporting for U.S. and South American media. She researches and reports on broad media competition issues and data privacy at the Center for Journalism & Liberty, a program of the Open Markets Institute, in Washington, D.C.
The trial for the first antitrust case the U.S. Department of Justice (DOJ) has brought against Google will kick off in D.C. today, but the public won’t be able to access any online feeds or recordings of it. Last Friday Judge Amit Mehta denied a request by several non-profit organizations– including my employer, Open Markets Institute– that sought to make public an audio feed of the unsealed portions of the case.
The case, in short, is about whether Google’s quest to dominate the search engine market broke U.S. antitrust laws. But unlike the last big tech monopoly trial in the nation’s courts, U.S. vs Microsoft in 1998, from which we have recordings of Bill Gates’ deposition, this time Google argued that because these proceedings may force it to reveal trade secrets, the public should be denied a live feed of the trial.
This is bad news not only for the public’s right to access public-interest information, but also for journalists trying to cover the trial from their own corners of the world. Only a limited number of reporters will attend the court in person, and we should expect them to access the courtroom only on the trial days that aren’t “sensitive” to Google’s business, as David Dayen writes in the American Prospect. The only remote access available is limited to the opening statements, by connecting to the court’s toll-free number (free only if you call from the U.S.).
To make matters worse, what this really means is that Google, armed with a massive public relations apparatus, will find it easier to spin whatever transpires in the trial to its favor. Thus, as the trial unfolds, the public and journalists should closely scrutinize anything Google says about what happens behind the court’s closed doors.
Here’s an attempt at listing four of such talking points to scrutinize.
1. “These Are Baseless Accusations”
In its public-facing defense, Google likes to tout that paying off its way to becoming a default search engine in mobile devices has had no effect in blocking competitors because users have always had the choice to change their phone settings. Therefore, it must be that Google’s greatness was achieved purely by consumer preference. Based on this reasoning, Google has labeled many of the antitrust violation charges it faces in the U.S. and abroad as “baseless.” But we are not in that stage anymore.
Judge Mehta, even after dismissing some state claims in the suit, will assess the great lengths that Google has gone to broker exclusive agreements in the market. Besides Google paying Apple billions of dollars to be the default search engine in Safari, the DOJ’s case also shows that similar agreements with Android phone manufacturers shaped the display designof mobile devices by restricting pre-installation of competing apps. Under such conditions, how could consumers actually know the choices they had based on what they saw on their phones? (e.g., by being prompted to switch app providers).
Google’s representation of such agreements is that they “promote competition.” But we should not ignore that the U.S. business has a long history of nefarious effects exclusive dealings have had when used to fortify monopoly positions. In Europe, Google already lost a similar case – which it fought ferociously. But since the conduct continued, it inspired language in the Digital Markets Act meant to constrain just this sort of behavior.
2. “Competition Is Alive and Well Thanks to AI”
As The Information recently reported, Google may try to argue that the online search market is more competitive now due to recent events. For example, Google could easily say that Microsoft’s investments in artificial intelligence upgrades to the search engine Bing “caused” Google to scramble to introduce Bard. This DOJ trial comes at a time of “unprecedented innovation” that is creating “more competition and options for people than never before,” The Information reports.
But this is a misleading view of competition that is permeating the recent push for generative AI applications. We are so used to seeing only Goliaths fighting over controlling large swaths of different markets that we can confuse that with a genuine and diverse competition.
The fact is that Big Tech firms – with Google, Microsoft, and Amazon among the top ones – already own, fund or provide the underlying infrastructure for almost any “new” company we see working on generative AI. Therefore, even if Microsoft (and that is a big “if”) were to eat into Google’s market share of online search with AI, the two behemoths would remain unchallenged, leaving this market in the same condition as it is today, with the only difference being an upgrade to an already existing tool.
3. From the PR Handbook: Exaggerate to Your Benefit
We can expect that whether the outcome is favorable to it or not, Google will try to either downplay the DOJ’s win or overstate its failure. We have plenty of examples in other cases. Last year, Google celebrated a “win” over a case led by the Texas Attorney General on monopolization of the digital advertising market, even though it lost its attempt to quash it. In reality, the judge denied Google’s motion to dismiss in three of four counts, allowing most of the case to move forward in court.
In Europe, in 2021 the French competition authority found that Google abused its market dominance in intermediating ad sales to favor its own ads, hurting publishers and advertisers. The case set an important global precedent, not only for its complexity, but also for being the first competition probe that Google did not dispute. Of course, Google portrayed the changes it was forced to make simply as a “way to make it easier for publishers” to use its products – not as a correction of its monopolistic behavior.
4. Reminder: More Google Monopoly Cases To Come
We should also be careful to contextualize developments in this trial with reference to evidence it broke antitrust laws in other markets. The trial now underway is the first but not the last challenge Google will face in the U.S. for anticompetitive behavior.
On the litigation front, there are at least two cases to keep an eye on. First, in a multi-state lawsuit challenging Google’s Play Store policies that squeeze app developers, Google and the plaintiffs just agreed to settle the case. The terms are still being discussed, but it is reasonable to expect not only a monetary fine, but also behavioral remedies; for example, forcing Google to allow third-party payment processing for in-app purchases and make available third-party app stores to be downloaded from the Play Store.
Second, there is the suit against Google’s illegal monopolization of the “ad tech” market, where web publishers and advertisers meet to sell and buy ads. This will be a complex but also potentially transformative case, as the DOJ seeks to break up Google’s ad tech business and any other units that generate conflicts of interest and enable it to abuse its dominant position in this market. A date for this trial is likely to be scheduled for the first half of 2024.
Since this is the first major tech antimonopoly trial since 1998, expectations are high. But regardless of the outcome, this is by no means the end of the road for scrutiny of Google or for antitrust enforcement efforts to foster a genuinely competitive digital market for the American people.